Abstract
This chapter discusses the policy actions taken by the US Treasury and by the Fed to prevent the recession from turning into a major depression, similar to the one we had in the 1930s. It examines the support provided to Bear Sterns and to AIG and discusses the failure to bail out Lehman, which some have questioned. It looks at the assistance provided to Freddy Mac and Fanny Mae and also outlines the key actions taken to boost effective demand in general and to help the auto industry, which faced the prospect of bankruptcy during the recession. It also discusses monetary policy, including the various phases of quantitative easing, during the Great Recession and its aftermath.
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Halperin, R.A. (2017). Fingers in the Dike. In: The Influence of Uncertainty in a Changing Financial Environment. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-48778-6_3
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DOI: https://doi.org/10.1007/978-3-319-48778-6_3
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Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-319-48777-9
Online ISBN: 978-3-319-48778-6
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